The United Nations development arm in Asia-Pacific called for greater innovation in disaster risk financing, warning that economic losses to disasters in the region could exceed $160bn annually by 2030.

The need is all the more pressing given that only 8% of region’s losses are insured, said the UN Economic and Social Commission for Asia and the Pacific (ESCAP).

“The time for establishing solutions to these complex emerging challenges is now,” said ESCAP executive secretary Dr Shamshad Akhtar, speaking at an event on financing for disaster risk reduction in Asia-Pacific in New York.

The low insurance coverage has persisted in the region even though it has suffered nearly $1.3tn in losses over the last 50 years. As a result, individuals, businesses and governments are left to bear the staggering costs of natural calamities.

And with extreme weather events increasing as the region’s cities become more crowded, the gap could widen. “Business as usual is unsustainable...policy makers and financial strategists in both the public and private sectors have to work together,” said Dr Akhtar.

She outlined the opportunities offered by recent innovations such as catastrophe risk modelling, parametric insurance, a mix of traditional and global financial reinsurance, and concessional insurance.

She also highlighted the role ESCAP – which spans a geographic region from Turkey in the west to the tiny Pacific island of Kiribati in the east, and from Russia in the north to New Zealand in the south – could play.

“The provision of a regional platform for building capacity as well as mutual trust among countries is the key to successful sovereign risk pooling [and] ESCAP, whose primary mandate is regional cooperation, is well suited for this role,” said Dr Akhtar.